India delays mobile number portability to March '10

By IBT Staff Reporter On 12/31/09 AT 10:59 AM

NEW DELHI, Dec 31 - India will introduce mobile number portability across the country by March 31, 2010, pushing back its commencement by up to three months in parts of the country, the government said on Thursday.

Mobile Number Portability (MNP), which allows users to retain their number even if they switch operators, was to be introduced in metro cities and the so-called Category A telecom zones from Dec. 31, and in other areas by Mar. 20, 2010.

The government has now decided to implement it in whole of the country in one go, by 31st March 2010, the Ministry of Communications and Information Technology said in a statement.

It said some of the telecoms firms were still in the process of upgrading their network and needed more time.

For the full statement, see link.reuters.com/dug39g

MNP is expected to further intensify the price war among operators as the churn rate, that is the number of people switching operators, increases and is seen as negative for incumbents such as Bharti Airtel (BRTI.BO), Vodafone Essar (VOD.L) and Reliance Communications (RLCM.BO).

On the other hand, it would help ventures of Telenor (TEL.OL) and Batelco BTEL.BH that have recently rolled out mobile services in India and those including Etisalat ETEL.AD that has plans to start Indian operations shortly.

Bharti shares extended gains after the news to close 1 percent higher in a Mumbai market that ended 0.7 percent up.

Bharti Airtel and Reliance Communications have been the only two stocks in the benchmark index that have given negative returns in 2009 amid the price war, where as the main index has risen by 81 percent. (Reporting by Devidutta Tripathy; Editing by Malini Menon)